If you own too much tech, now is the time to use caution, says Jim Cramer
Speakers
Jim Cramer
— Host, Mad Money
Summary
Jim Cramer advises caution on overconcentration in tech due to Chinese AI threats and volatility. He recommends rotating into high-quality, comprehensible non-tech stocks like FedEx, Honeywell Aerospace, and GE, while defending core tech holdings Apple, Nvidia, Intel, and Broadcom. He also tells a caller not to sell AutoZone, citing low valuation and buybacks.
- Warns that owning too much tech could lead to being ‘slaughtered’ by unpredictable Chinese AI headlines.
- Recommends buying non-tech names like FedEx, Honeywell Aerospace, and GE, which are comprehensible and can be bought on dips.
- Highlights a specific opportunity in GE after the stock fell despite a record LEAP engine order.
- Remains bullish on Nvidia for its data center dominance and cheap forward earnings.
- Sees Intel as a triple play (CPU, foundry, packaging) and wants to buy more on any post-earnings sell-off.
- Defends Apple, calling its core business bulletproof and the Alphabet AI deal smart, and not selling.
- Advises against selling AutoZone, noting 19x earnings and share buybacks.
- Suggests rotating into sectors like industrials and healthcare for lower volatility.
Ideas
Comprehensible aerospace, buy on dips.
Honeywell Aerospace is a high-quality, comprehensible non-tech aerospace stock that can be bought with confidence on dips, unexposed to Chinese AI risks.
Comprehensible non-tech, buy on dips.
FedEx is a high-quality, comprehensible non-tech company that is not subject to Chinese AI rumors. It can be bought with confidence on dips, and today was a day to buy it.
Core business bulletproof, AI criticism overblown.
Apple's core iPhone business is bulletproof; the company spent little on AI and the deal with Alphabet to put AI features in the iPhone is a great deal. Criticism from the tech intelligentsia is overblown, and no one is switching to Samsung. The stock is a hold, not being touched.
Cheap, dominant data center chipmaker.
Nvidia shares are insanely cheap on next year's earnings estimates. The company is at the heart of the data center, practically invented it, has no real Chinese competitor, and customers insist on Nvidia. The stock is a buy.
Triple play CPU, foundry, packaging opportunity.
Intel is a triple play: CPUs needed for new AI agents, foundries to manufacture chips, and high-margin chip packaging. CEO Lip-Bu Tan is expert in packaging, and the foundries are the best hope for US semiconductor renaissance. Wants the stock to sell off on earnings to buy a bigger position.
CEO Hock Tan hates losing.
Broadcom is owned because CEO Hock Tan hates to lose and is a fierce competitor, making the stock attractive.
Record engine order, irrational dip.
GE received its biggest ever order for LEAP engines to power Airbus A320neos through a joint venture, yet the stock fell sharply. This irrational sell-off creates a buying opportunity.
Rotate out of tech into industrials, healthcare.
It is time to rotate out of tech into other sectors like industrials and healthcare that can make money without the extreme volatility caused by Chinese AI headlines.
Cheap at 19x earnings, buybacks.
AutoZone trades at only 19 times earnings, continues aggressive buybacks, and can make a comeback despite tariff problems. Do not sell the stock down here.
